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(Adds shares, background on vaccine candidate)
April 23 (Reuters) - Inovio Pharmaceuticals said on Friday the U.S. government had stopped funding for a late-stage study testing its COVID-19 vaccine candidate, due to the increasing availability of authorized shots in the country.
Shares of the drug developer fell 31% to $6.38 before the bell.
"This decision is not a reflection of the awardee or product, rather a fast-moving environment associated with the former Operation Warp Speed on decisions related to future products," the U.S. Department of Defense told Inovio, according to a company statement.
The department will continue to fund an ongoing mid-stage study testing its vaccine candidate INO-4800, Inovio said.
The U.S. government last year launched the Operation Warp Speed program to provide funding for companies developing drugs and vaccines to combat the coronavirus.
Since then, the United States has authorized the use of three vaccines from Pfizer Inc and partner BioNTech SE , Moderna Inc and Johnson & Johnson.
Rival Novavax also has a vaccine candidate in a late-stage of clinical development and expects U.S. authorization to come as early as May after soon-to-be released data from its U.S. vaccine trial are reviewed by regulators.
Inovio lagged behind rivals in the race to develop a COVID-19 vaccine, after the U.S. Food and Drug Administration in September put a portion of the IN0-4800 study on hold, as it sought more information on the device used to inject the vaccine.
The company said it was planning for a late-stage global study mostly outside the United States based on the upcoming results from the mid-stage trial.
Inovio added that it would continue to test its other vaccine candidate, INO-4802, targeting variants of the coronavirus.
(Reporting by Manojna Maddipatla in Bengaluru; Editing by Amy Caren Daniel)